Hospitality sector needs a break on bank debt
Paschal Donohoe urged to encourage banks to restore moratorium on debt repayment
A view of an empty Devlin Hotel in Dublin 6.
The Government’s decision to extend Level 5 lockdown restrictions until March 5th will not have surprised the hospitality sector here. And the restrictions will probably be extended beyond that date, too, possibly past the Easter weekend in early April.
And the move to effectively pull the shutters down on in-bound travel means there will be no international tourists for a second year in a row.
This raises issues about the sustainability of the sector and as to how many businesses will be left standing once the dust settles on Covid-19.
Speaking on Inside Business, a podcast from the Irish Times, Elaina Fitzgerald Kane, Irish Hotels Federation president and sales director of the Woodlands hotel in Adare, Co Limerick, called for more certainty on two of the main Government supports available to businesses - the wage subsidy scheme (due to finish at end March), and the commercial rates waivers (extended until the end of the first quarter).
“The reality is that we’re going to need it [wage subsidy scheme] until the end of 2021,” she said.
On rates she noted that the UK has a 12-month waiver. “Ours is a piecemeal approach that goes down to the wire every single time. And the reality is if we had money, are we going to pay rates or put that money into trying to sustain and restore employment ? It would be a very easy decision for me.”
Fitzgerald Kane would also like to see Minister for Finance Paschal Donohoe encourage the banks to restore the moratorium on debt repayment, which was in place from March until October last year.
“When you are paying out and there’s no money coming in...that is causing huge stress from a solvency perspective, especially when you are trying to lay the foundations for reopening. You are at the discretion of the bank and, if you change anything, forbearance kicks in and that changes your credit rating and your opportunities going forward. That is something that should be easy to address right now.”
Over to you minister.